By Tiernan Ray

Shares of Electronic Arts (EA) are down 57 cents, or 2.3%, at $24.30, and traded down to $23 and change initially, after the company this afternoon reportedfiscal Q3 revenue that missed consensus, and a Q4 revenue forecast lower as well.

Revenue in the three months ended in December rose 33%, year over year, to $1.57 billion, yielding EPS of $1.26.

Analysts had been modeling $1.66 billion and $1.23 per share.

EA’s CEO Andrew Wilson called the quarter’s results “an exciting start to a new generation of games,” with the company claiming top spot in game software titles sold on the new gaming consoles that debuted during the holiday, including Microsoft’s (MSFT) “Xbox One,” and Sony’s (SNE) “PlayStation 4,” with 40% share of games sold on PlayStation 4, and 30% share on Xbox One, according to NPD data.

The company said in prepared remarks that “the uptake of next-gen consoles has been faster than we expected.”

The company said it also had its biggest month ever in December for downloads of games on mobile devices, with 71 million downloads on Apple’s (AAPL) App Store and Google’s (GOOG) “Google Play” software store. It said that was more than any game company in the world.

Still, Wilson called it a “transitional quarter,” while noting the company beat its own EPS goal for the three months.

For the current quarter, the company sees revenue of about $800 million, below the average estimate of analysts of $829 million. EPS is seen at about 9 cents a share, in line with consensus.

For the full year, EA now sees revenue of $3.91 billion, on a non-GAAP basis, down from a projection for $4 billion offered back in late October. The company attributed the shortfall to “the weakness in current generation software.” However, it raised its EPS view for the year to $1.30 from $1.25, citing improvement in operating profit.

During the call, CFO Blake Jorgensen explained the shortfall in outlook, attributing it to “the steeper-than-anticipated declines we saw in current-gen software revenues, “ but also reminding analysts that “in Q4 last year we launched five core titles and recognized the full year’s Battlefield 3 Premium subscription revenue; this year, we will be launching two titles in the quarter and recording Battlefield 4 Premium subscription revenue on a ratable basis.”

Also on the call, Wilson addressed the issues in the quarter with “Battlefield 4,” a war game that immediately ran into issues when it was released in November, problems with basic game functionality that caused EA to throw all its development talent at fixing the problem, according to reports at the time.

Wilson sounded confident the stumble would not be a major issue for the company:

Shortly after Battlefield 4 went live, we began hearing from some players in the community who were experiencing issues with the game. The Battlefield team acted swiftly to address the issues through game updates, and they continue to make refinements as part of our live service to ensure a great game experience for all Battlefield 4 players. Battlefield 4 is an amazing game in size, scope, and gameplay, and we’re confident that gamers will be playing for a long time to come.

The company’s director of its EA Studios team, Patrick Söderlund, added some more color, describing unprecedented development challenges that had cropped up with Battlefield:

What happened part is when Battlefield 4 launched, it was a very complex game launching on two entirely new platforms. We were pushing innovation heavily and delivering 64 players plus the ability to connect via mobile tablet as a commander into the product. Coupled with that were some very innovative features. Based on our prelaunch testing, we were confident the game was ready when it was launched. Shortly after launch, however, we began hearing about problems from our player community and the development team quickly began to address the situation. So what have we done since we encountered the problems is we are fortunate to have an architecture in place that allows us to update the game rapidly, and that is actually what we have done. We released multiple software updates across all platforms to resolve the primary issues and gain stability. To the final point, which is how we are learning from this, the challenges we face were different than anything we’ve seen before with other games. There were different issues that only manifested at scale in the post-launch live environment. We are taking multiple steps to evaluate what occurred and incorporate learnings into our development process for future products so we don’t experience the same problems again. I would close on the fact that battlefield remains an amazing game with massive innovation and we’re confident that gamers will be logging on to play for a long time to come.

Asked about the shape of the new console sales, Wilson reiterated a view that the new machines will sell in excess of ten million units by the end of March.

About Tech Trader Daily

Tech Trader Daily is a blog on technology investing written by Barron’s veteran Tiernan Ray. The blog provides news, analysis and original reporting on events important to investors in software, hardware, the Internet, telecommunications and related fields. Comments and tips can be sent to: techtraderdaily@barrons.com.